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NEW YORK — Investors found some reassurance in weak job growth figures yesterday, and sent stocks sharply higher on a bet that the numbers will prompt Federal Reserve to be less aggressive in raising interest rates. The Dow Jones industrials climbed more than 120 points as Wall Street had its best week of 2005.

The Dow rose 123.03 to 10,716.13. It was the first triple-digit gain for the Dow in 2005 and the best one-day gain since Dec. 1.

Microsoft, one of the 30 Dow stocks, added 14 cents yesterday to close at $26.32, up 0.5 percent for the week. Boeing, also a Dow stock, gained 58 cents to $52.58 and ended the week up 5.3 percent.

Broader stock indicators also moved substantially higher. The Standard & Poor’s 500 index was up 13.14 at 1,203.03, breaking through the 1,200 level for the first time since Jan. 3. The Nasdaq composite index gained 29.02 to 2,086.66, the index’s best close since Jan. 18.

For the week, the Dow rose 2.77 percent, the S&P 500 climbed 2.7 percent and the Nasdaq gained 2.5 percent. The Dow and S&P 500 are down less than 1 percent for 2005. The Nasdaq remains down 4.1 percent, as small-cap stocks and technology shares have taken the brunt of investors’ unease.

The markets opted for a glass-half-full approach to the Labor Department’s job creation report, which showed just 146,000 new jobs last month, far less than the 200,000 expected.

December’s job gains were revised downward to 133,000 from the 157,000 reported a month ago.

While such a disappointing report has driven stocks lower in the past, the numbers assuaged investors’ fears that inflation would become an issue. With the economy growing at a tepid rate, inflation is unlikely to be a factor, and the Fed Reserve’s modest stance on raising interest rates would remain unchanged.

“I certainly think this (jobs) report provides no reason for the Fed to turn more aggressive in its tightening. That’s because while it’s creating jobs, the economy is not booming and there’s not a lot of labor-cost pressure in the system,” said Richard Rippe, chief economist at Prudential Equity Group in New York.

The week’s good news — successful elections in Iraq, no surprises from the Fed on interest rates and falling oil prices — prompted many of the gains and helped investors put yesterday’s jobs report in perspective, analysts said. Economic growth, without inflationary pressures, could be healthier for the economy in the long-term, not to mention better for stock prices.

“It really is the sweet spot,” said Scott Wren, equity strategist for A.G. Edwards & Sons. “This economic environment is just very modest and very sustainable, with non-inflationary growth. That’s the kind of environment that’s good for stocks.”

With the bulk of a largely upbeat earnings season over, the jobs report was the main catalyst for investors yesterday. Still, there were some companies releasing earnings, including media conglomerate Time Warner, which fell 12 cents to $18.04, even though it beat Wall Street expectations by 4 cents a share.